BALAJI S. Vs. BANKING OMBUDSMAN

JUDGEMENT

(1.) The prayer in this Writ Petition is to quash the order of the 1st respondent, the Banking Ombudsman and to direct the 2nd respondent, IndusInd Bank Limited to issue No Objection Certificate, in respect of the loan account cleared by the petitioner. By the impugned order, the complaint that is preferred by the Writ Petitioner against the 2nd respondent - Bank was rejected by the 1 strespondent.

(2.) The brief facts are that the petitioner - S.Balaji, availed a loan for purchase of LPG tanker lorry with Registration No.KL 09 AG 6814 with the 2nd respondent - Bank, vide loan account bearing reference No.TAN03010D dtd. 27/3/2018. The petitioner fully repaid the loan and the account was closed on 27/10/2021. However, the Bank is refusing to issue No Objection Certificate (NOC) and to release the title documents.

(3.) The case of the Bank is that, apart from the above loan account, there was another loan in Account No.TAN02932D where one K.Leelavathi is the principal borrower and the petitioner is a co-borrower. The said loan remained outstanding and the Bank therefore, invoked arbitration proceedings in ACP No.IND/SP/278/2021 and already an award was passed on 26/12/2022. Even the said loan was also for purchase of a vehicle and the vehicle could not be located or seized by the Bank. Therefore, since the amount remains unpaid, the Bank had marked the lien on the above NOC and the title documents. In terms of paragraph No.20.2 of the loan agreement, the Bank withheld the issue of NOC. The clause No.20 of the loan agreement is extracted hereunder for ready reference:-